CEO of construction firm that started building failed downtown Detroit jail says project had ‘internal issues’

DETROIT, MI – Walbridge Chairman and CEO John Rakolta has known for months that his construction company would no longer be working on downtown Detroit's Wayne County jail project, which had ballooned to nearly $100 million over budget before work was halted in June.

But Rakolta said Wednesday that his firm had nothing to do with the project leaping over budget.

“The (county) terminated us for what they call their convenience – not for cost – and I don’t think that’s been well enough reported in the press,” Rakolta told MLive after speaking at the 2013 CEO Summit at the Westin Book Cadillac. “Walbridge did everything that we said we would do on this project. We’re not the cause of the overruns. They have their own internal issues.”

The Wayne County Building Authority voted in August to terminate contracts for completion of the partially-constructed new Wayne County Jail, which was then estimated to be about $90 million over budget. AECOM was the project manager.

The county has already spent $121 million on the partially finished complex Gratiot Avenue and Madison Street.

The county had begun soliciting proposals for alternative development plans, and on Wednesday, the it is expected to name a development project led by Quicken Loans founder and Chairman Dan Gilbert to redevelop the site as an entertainment complex. Gilbert and his umbrella company, Rock Ventures, own a majority share in the nearby Greektown Casino and Hotel.

The county will likely move the jail services that were going to be at the downtown site to a location on Mound Road, where the state had originally offered the county a property for just $1.5 million.

Meanwhile, an audit of the project by the county auditor general remains sealed, because Wayne County Prosecutor Kym Worthy said its release could compromise a criminal investigation her office is conducting. The county’s executive office has also done an audit.

Rakolta said the audits will further show that Walbridge did not play a role in the project’s budget woes.

David Muller is the business reporter for MLive Media Group in Detroit. Email him at dmuller@mlive.com or follow him on Twitter or Facebook.